from the Iowa District Court for Linn County, Sean W.
manufacturer appeals a grant of summary judgment to former
shareholders in an indemnity action. The former shareholders
cross-appeal the denial of attorney fees.
Scott Bardole of Andersen & Associates, West Des Moines,
M. Caves and William T. McCartan of Bradley & Riley PC,
Cedar Rapids, for appellees.
by Potterfield, P.J., and Tabor and Mullins, JJ.
Equipment Company wants Donald and Karen Gaddis, one-time
shareholders, to pay for its defense of products liability
claims brought by an injured truck driver. More than three
years before the driver sued CEI, the Gaddises sold their
shares. In their stock purchase agreement (SPA), they agreed
to several indemnification clauses with varying time
limitations. The Gaddises now say CEI's request for
indemnification is untimely under the SPA. Finding the
SPA's unambiguous language did not include a time limit
for this indemnification action, we reverse the grant of
summary judgment in favor of the Gaddises, reverse the denial
of CEI's motion for summary judgment, and remand to the
district court for further proceedings. And, because the
Gaddises are not the prevailing party in the summary judgment
proceeding, we affirm the denial of attorney fees.
Facts and Prior Proceedings
material facts are not in dispute. The Gaddises previously
owned shares in CEI, a truck trailer design and manufacturing
company. On December 17, 2012, they sold their shares to
Normandie Holdings, LLC, under a detailed SPA. The SPA
included terms indicating the Gaddises would indemnify CEI in
the event of certain claims against them.
December 26, 2014, truck driver Barry Willets was injured
when an auger manufactured by CEI broke away from its trailer
and fell on top of him. In May 2016, he sued CEI, alleging
defects in the auger's design and
2016, CEI answered Willets's claims and filed a
third-party petition against the Gaddises seeking to enforce
the indemnity provisions of the SPA and for breach of
contract. CEI insisted because the auger at issue was
manufactured before the Gaddises sold their shares, they have
a contractual obligation to indemnify CEI.
CEI's claims were time-barred under the SPA's
indemnification provisions, the Gaddises sought summary
judgment. CEI filed its own motion for summary judgment
seeking an order that the Gaddises indemnify it against the
claim. The district court granted the Gaddises' motion,
denied CEI's motion, and dismissed the Gaddises from the
action. The Gaddises filed an application for attorney fees
against CEI, asserting the indemnity and breach-of-contract
claims were frivolous. The district court denied their
appeals the district court's rulings on the cross motions
for summary judgment; the Gaddises cross-appeal the denial of
Scope and Standards of Review
review rulings on motions for summary judgment for correction
of legal error. Deeds v. City of Marion, 914 N.W.2d
330, 339 (Iowa 2018). Summary judgment is proper if Gaddises
established no genuine issue of material fact existed and
they were entitled to judgment as a matter of law. See
id. Summary judgment is also proper where the only issue
to be decided is what legal consequences follow from
otherwise undisputed facts. Emmet Cty. State Bank v.
Reutter, 439 N.W.2d 651, 653 (Iowa 1989).